Indonesia - South Korea Trade 2023 Q2: Stagnant Growth, Tech Imports

Key Market Takeaways: Indonesia - South Korea Trade

The bilateral trade relationship between Indonesia and South Korea shows flat growth with high volatility in Q2 2023.

• Trade deficit of $400M for Indonesia, with total exchange volume at $4.8B. Imports ($2.6B) outpaced exports ($2.2B), but both sides saw stagnant YoY growth.
• Resource-for-Tech exchange: Indonesia supplies mineral fuels (39% of exports) while importing high-value machinery (20% of imports), per Indonesia - South Korea trade statistics.
• Asymmetric interdependence: South Korea holds the value-add advantage, with Indonesia reliant on its tech imports for industrial inputs.

This bilateral trade snapshot is based on verified customs data from the yTrade database.

Indonesia-South Korea Trade Trend in Q2 2023

Indonesia Export Performance: Shipments to South Korea

• Total Volume: $2.20B in Q2 2023.
• Growth Trend & Context: YoY growth flat (0.0% across all months). No significant policy shifts or external events noted.
• Key Volatility: May saw a 7.06% MoM increase, while June dropped sharply (-12.95% MoM).

Indonesia Import Performance: Sourcing from South Korea

• Total Volume: $2.60B in Q2 2023.
• Growth Trend & Context: YoY growth flat (0.0%). No news to explain fluctuations.
• Key Volatility: May surged 59.43% MoM, but April and June saw declines (-36.68% and -21.5% MoM, respectively).

Indonesia - South Korea Trade Balance & Market Dynamics

• Net Position: Trade deficit of $400M (Imports exceeded exports).
• Relationship Status: Indonesia remains a net importer from South Korea, with volatile monthly inflows.

Indonesia Import Trend from South Korea 2023 Q2 (Source: yTrade)**

Indonesia Export Trend to South Korea 2023 Q2 (Source: yTrade)**

Get Historical Indonesia South Korea Trade Records

Indonesia-South Korea Top Trading Products in Q2 2023

Indonesia Export Profile: What Does Indonesia Sell to South Korea

• Top Commodity: HS Code 27 (Mineral fuels, oils) dominates with 39.44% share.
• Demand Driver: South Korea uses these for industrial processing and energy needs.
• Concentration: The trade is highly concentrated, with HS27 alone accounting for nearly 40% of exports.

Indonesia Import Profile: What Does Indonesia Buy from South Korea

• Top Commodity: HS Code 84 (Nuclear reactors, machinery) leads at 19.51% share.
• Dependency Nature: Critical technology dependency, as these are high-value industrial inputs.

Indonesia - South Korea Trade Relationship Dynamics

• The Exchange Model: Resource-for-Tech Complementarity. Indonesia supplies raw materials (fuels, ores) while importing machinery and tech from South Korea.
• Value Chain Position: South Korea holds the higher value-add position, exporting advanced machinery (HS84, HS85) against Indonesia’s commodity-heavy exports.

Import Analysis by Product: South Korea to Indonesia (Source: yTrade)

Export Analysis by Product: Indonesia to South Korea (Source: yTrade)

Check Detailed Indonesia-South Korea Trade HS Code Breakdown

Future Outlook & Strategic Recommendations

Forecast

Indonesia’s trade with South Korea is expected to remain volatile in the near term, with the deficit likely persisting due to structural imbalances. While demand for Indonesian mineral fuels (HS27) will stay steady, South Korea’s dominance in high-value machinery (HS84) ensures continued import dependency. Without diversification or policy intervention, the $400M quarterly deficit could widen further, especially if commodity prices fluctuate. Traders should prepare for uneven monthly swings, mirroring Q2’s erratic performance.

Strategic Moves

• Lock in Fuel Supply Contracts: Indonesian exporters of mineral fuels should secure long-term agreements with South Korean buyers to stabilize revenue and mitigate price volatility.
• Diversify Export Basket: Reduce reliance on HS27 by promoting secondary sectors like agriculture (HS08) or textiles (HS61), leveraging Indonesia’s competitive labor costs.
• Localize Tech Imports: Indonesian manufacturers must explore joint ventures with South Korean firms to domesticate production of critical machinery (HS84), cutting import dependence over time.

Frequently Asked Questions

How did Indonesia - South Korea trade perform in 2023 Q2?

Indonesia's exports to South Korea totaled $2.20B, with flat YoY growth (0.0%), while imports reached $2.60B, also showing no YoY change.

What are the top exports from Indonesia to South Korea?

Mineral fuels and oils (HS Code 27) dominated, accounting for 39.44% of Indonesia's exports to South Korea.

What does Indonesia import from South Korea?

Nuclear reactors and machinery (HS Code 84) were the top imports, making up 19.51% of Indonesia's purchases from South Korea.

What is the trade balance between Indonesia and South Korea?

Indonesia had a trade deficit of $400M with South Korea in Q2 2023, as imports exceeded exports. The deficit reflects the resource-for-tech exchange dynamic.